The 23-unit Laurelhurst Apartments is the type of sturdy prewar building you might drive by without noticing. Its low-slung, three-story brick facade is unpretentious and symmetrical. Built in 1917, it looks solid enough to weather 100-plus years of relentless Portland, Oregon, rain, as well as a revolving cast of renters coming and going—and, until recently, it had.
For the last 40 years, Laurelhurst was part of REACH CDC’s portfolio. The longtime affordable housing provider owns and manages more than 2,900 affordable homes across three Portland metro counties. But in late 2024, REACH quietly sold Laurelhurst; the building and its systems needed extensive repairs that the nonprofit community development corporation (CDC) couldn’t afford, including a costly new roof and significant seismic upgrades.
The sale of the building was brokered by Bjorn Beer, a vice president at SVN Imbrie Realty who specializes in helping nonprofits and public housing agencies pursue creative disposition and recapitalization strategies. Beer says REACH approached him with the goal of finding a mission-aligned buyer who could complete the capital investments the building needed without taking the units market rate. REACH wanted to reinvest the proceeds from the Laurelhurst sale into stabilizing its broader portfolio and supporting new development already in the pipeline.
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Beer connected the nonprofit with Condo.Fund, a for-profit startup development company—to which Beer serves as a consultant—with a simple pitch: buy aging multifamily rentals; upgrade the units, systems, and infrastructure as needed; and sell them individually as affordable condos targeted at households earning around 80 percent of area median income, or AMI (currently $94,400 for a family of four in the Portland metro area). “We’ve brought back the starter home,” says John Laine, the founder of Condo.Fund. “In a market where the average home price is $550,000, we’re selling condos in the $200,000 range.” (The median home price in Portland was $499,000 as of December 2025.)
On its face, the Laurelhurst sale seems like a rare win-win amid Portland’s housing crisis: a nonprofit sheds a financially strained property, and a for-profit developer promises “starter homes” at prices notably below the city’s median. But the “simple” conversion plan also exposes a deeper fault line in the affordability conversation. The same building with income-restricted, low-cost rental units that REACH concluded it couldn’t afford to rehabilitate is now being repositioned for individual homeownership—without deed restrictions, resale limits, or other mechanisms that would guarantee long-term affordability. Instead, the model depends on temporary subsidies, optimistic assumptions about rent-to-mortgage parity, and the willingness on the part of individual homeowners to absorb long-term repair risks that once sat with an institutional owner.
If it’s successful, this conversion project—and those like it, as Beer reports interest from “multiple affordable housing groups . . . in Oregon and Washington”—could give Portland tenants a chance at homeownership. That’s no small feat in a city where entry-level buyers are often priced out before they even start looking.
But if it fails, low-income Portland renters could be left with fewer options than before—displaced, and with homeownership still out of reach.
The Condo.Fund Model
As REACH weighed whether to sell Laurelhurst, it was confronting a reality that’s becoming harder to ignore: more mission-driven owners and housing agencies are now going on the record to say that they’re selling or shrinking portfolios to close operating gaps and keep the rest of their units viable. In that context, Lauren Schmidt, REACH’s fundraising and public relations manager, says Condo.Fund’s pitch stood out as a way to turn a stressed asset into a different kind of affordability play.
Condo.Fund . . . felt like an extension of our mission to provide opportunities for affordable homeownership for folks who are generally marginalized and priced out of that market.”
Lauren Schmidt, fundraising and public relations manager, REACH CDC
“What stood out for us with Condo.Fund was that it felt very mission-aligned with our values,” Schmidt says. “It felt like an extension of our mission to provide opportunities for affordable homeownership for folks who are generally marginalized and priced out of that market.”
Beer describes the Laurelhurst deal as a “three-legged stool.” “Private capital + homeownership advocacy group + nonprofit seller = magic,” he wrote in an email, explaining that the model requires a homeownership advocacy or counseling group in the mix, because it only works if prospective homebuyers are prepared to buy. To include this leg of the stool, Beer introduced Condo.Fund to Portland Housing Center (PHC), a nonprofit that provides homebuyer education, counseling, and access to mortgage products for low- and moderate-income households.
The idea: ensure that any tenants interested in buying would at least have access to counseling and preparation before attempting to qualify for a mortgage. From Beer’s perspective, PHC serves as the steward that keeps the “starter home” promise from collapsing into a churn-and-displace conversion. PHC helps make sure interested tenants receive counseling and a reality check on qualification, financing, and the responsibilities that come with a condo association.
“We can sit down with [buyers] and say, ‘Let’s look at the numbers. Let’s look at the reality of what this opportunity is,’” says Laura Bower, homeownership program director at PHC. “And for some folks, maybe this particular opportunity isn’t it.” On the other hand, she says, it might plant a seed of, “Maybe I can. Maybe homeownership is an option for me.”
PHC’s role is protecting the resident side of the equation by making sure “opportunity” doesn’t become a euphemism for displacement. Beer’s there to solve a different problem: how to move a distressed building in a way that keeps REACH financially whole enough to protect the rest of its portfolio. In his telling, “mission alignment” isn’t about achieving a perfect outcome for every tenant; it’s about threading the needle between negatively affecting residents and meeting the requirement that the deal generate enough proceeds for REACH. And it’s important to keep in mind that the alternative buyer pool would have produced value, too, just without any consideration or care for the people already living there.
“We wanted to find the most mission-focused buyer, but also drive the most value for the organization,” Beer wrote in an email. “From the perspective of the nonprofit, it was a decision between this creative solution or selling it to some investor who would have converted [the building] to market-rate hipster apartments without caring about the current residents or the mission of affordable housing.” Preservation funding for major capital needs—seismic upgrades, new plumbing, a new roof—has become increasingly scarce, he added, leaving few viable options.
Laurelhurst was an ideal candidate for Condo.Fund. When Laine and his team consider properties, they look for places where existing tenants pay around $1,800 per month in rent. The idea is that a family that can afford that amount of rent will likely qualify for a mortgage at around the same monthly payment. Laine calls this “rent-to-mortgage parity,” and bases much of his idea that renters can transition to homeowners on it. (It’s worth noting that, while intuitive, the concept is not a recognized affordability standard in housing finance or underwriting.)
To further smooth the runway to homeownership, the company’s business model includes helping existing renters come up with a downpayment. “If [residents] make their rent payment on time, as agreed—normal landlord stuff—if they do that [for] four months in a row, we’re going to credit them their four months,” Laine says. He uses $1,500 “as a round number” for a hypothetical buyer’s rent payment, explaining that Condo.Fund would allow that renter to bank four months of rent, or $6,000, toward a downpayment for purchasing one of the renovated units.
Condo.Fund’s downpayment equation also includes using the city-mandated relocation assistance amount current tenants are due in exchange for converting their rental unit as funds toward the downpayment. (Portland law requires relocation assistance for tenants displaced without cause, including when buildings are converted into condos. Depending on the size of the unit, landlords must pay between $2,900 and $4,500 in relocation assistance.) “So, we’re going to give them $6,000, plus . . . we’re going to give them that other, call it, $3,600 for relocation as well. So, they come really close to $10,000 as a downpayment,” Laine explains. “We’re really trying to keep [mortgage payments] as super close to what they’re paying for rent as possible. If we can keep it somewhere around $2,000, we think we can convert a lot of people into homeowners.”
Housing counselors, however, emphasize that a $10,000 down payment is only part of what a buyer needs to get to the closing table. Closing costs typically run anywhere between 2 and 5 percent of a home’s purchase price, not including the downpayment. This means shelling out an additional $4,000 to $10,000 on top of the downpayment for a $200,000 condo. Closing costs can include line items like property taxes, homeowners insurance, and interest until the first payment is due. In some cases, the lender also wants buyers to have documented cash reserves available. Then there are the utility hookups, furnishings, internet and parking payments, and other costs that make the “cash to close” number jump quickly and unpredictably for buyers.
These soft costs can quickly push the total liquid funds required well beyond the downpayment, even on a $200,000 purchase. A $10,000 down payment, for example, can be enough to get a deal going on a $200,000–$230,000 condo. (At $200,000, that would be a 5 percent downpayment; at $230,000, it’s about 4.3 percent.) But at those loan-to-value ratio levels (95 percent and 95.7 percent, respectively), buyers should generally expect to have to tack on private mortgage insurance (PMI). Lenders generally require PMI when a downpayment is less than 20 percent of a sale price. Federal Housing Agency loans—often used by first-time buyers with smaller downpayments—allow downpayments as low as 3.5 percent but still require mortgage insurance.
And affordability doesn’t end at closing: Monthly homeowner association (HOA) dues and the financial health of the association can affect both underwriting and long-term stability, especially in older condo conversions where lenders scrutinize reserves and repair plans. A $10,000 boost can narrow the gap to homeownership, but it doesn’t guarantee a closed deal.
[RELATED ARTICLE: Condos—A Key Source of Affordable Housing for Homeowners—Are in Jeopardy]
To help the early numbers pencil out for all new potential buyers—not just existing residents—Condo.Fund is subsidizing monthly HOA dues at its properties with an up-front infusion of cash to “buy down” dues for two years. For now, that means residents are paying only around $150 per month in dues, which cover water, sewer, and garbage, as well as repair reserves and common-space maintenance—far below the $350 to $500 Laine says is typical for Portland condos. Once the subsidy expires in May 2027, dues are expected to rise immediately by $50 to $75, and then will be subjected to annual 3–5 percent cost-of-living increases. Laine adds that the buydown is essential for hitting the rent-to-mortgage parity that’s key to making condo ownership feasible for longtime renters.
“We’ve got to be able to come back to the idea of, you got a family that’s just paying their rent, and they’re used to paying rent,” he says. “Now you’ve got mortgage, taxes, insurance, HOA. . . . We’re really trying to keep that as close as possible to what they’re paying for rent.” He doesn’t have a plan for how residents should prepare for the increase in dues; Condo.Fund’s business is modeled for an 18- to 24-month investor off-ramp.
Temporary Subsidies, Permanent Risks
While it’s refreshing to see condos at affordable price points in Portland’s long-overheated for-sale housing stock, housing counselors stress that affordability isn’t just about the sticker price. Buildings like Laurelhurst are old, with major capital needs that REACH itself—a well-established and experienced housing organization—determined it could not afford to take on. In a condo conversion, those long-term repair costs don’t vanish; they are redistributed, often landing on homeowners through rising HOA dues or future special assessments.
Even if purchases work out for the first buyers, Condo.Fund’s business model lacks any mechanism to keep the condos affordable.
In permanently affordable housing programs—whether community land trusts, limited-equity co-ops, inclusionary zoning ordinances, or some other format—affordability requirements are typically recorded directly on the property deed, or encompassed in a binding resale formula agreement. Those legal covenants spell out intricacies like income eligibility, resale price formulas, and owner-occupancy rules. Most importantly, they remain binding for every future buyer, ensuring that the homes stay affordable not just for the first buyer, but also for future buyers.
For Condo.Fund homes, affordability and whether homes remain owner-occupied or go to investors rests entirely on initial pricing and whatever rules the HOA adopts and enforces. The organization stipulates that buyers must live in their units for the first year; after that, whether condos are allowed to become rentals is entirely up to the HOA. “Sometimes the limit is 25 percent rentals, sometimes more,” says Merilee Lloyd, a Portland broker-of-record for for-sale Condo.Fund units, “and if you hit that cap, it’s usually a lottery.”
REACH, which bakes affordability into its operating agreements, draws a sharp distinction between mission intent and enforceable, resident-facing terms. “For other nonprofits considering a mission-aligned sale, start with absolute clarity on your purpose and nonnegotiables,” Schmidt wrote in an email. “It’s essential to embed resident protections directly into the agreement so they are enforceable commitments, not aspirational goals or ‘handshake’ promises.”
REACH’s post-sale influence, however, was limited. In a December 2024 notice to Laurelhurst households, REACH told its tenants that details on “the homeownership opportunity or relocation options from Condo.Fund” would be forthcoming and said it would “work with Condo.Fund to provide education and support for residents exploring purchase.” (Schmidt says REACH is closely watching the outcome of the Condo.Fund deals and might consider adding internal homeownership counseling programs to its subsidies, HOA buydowns, and other support options in the future.) But transition support measures are not the same as long-term affordability controls. To date, Condo.Fund has not recorded any deed restriction, resale formula, or other covenant that would keep the units affordable following initial sales.
Laine and Beer both lean heavily on initial pricing to support their affordability claim, but they admit that long-term price caps weren’t built into Condo.Fund’s business model. None of their mechanisms—rent credits, relocation assistance, and HOA subsidies—bind future owners or restrict resale prices to keep units affordable for future buyers, or even owner-occupied. After the two-year HOA subsidy runs out, costs will climb. After the one-year occupancy rule lapses, investors could enter through the back door of HOA decisions.
When Shelterforce initially asked about long-term affordability protections, Laine and Beer both acknowledged they hadn’t thought much about them. They later said, however, that Condo.Fund plans to pursue stronger affordability protections in future projects.
Cracks in the Model: Campus Lessons
Condo.Fund’s model is showing stress even by its own measures of success. Though its affordability pitch is simple, the team has found that not much else in affordable housing is.
The Laurelhurst conversion is Condo.Fund’s second project; its first, Campus Apartments in North Portland, came online in March 2025 after extensive renovations. It’s a small complex in a coveted area, located directly next to Portland Community College. All studios and one-bedrooms are priced between $210,000 and $238,000. The pilot project’s numbers looked straightforward enough for turning renters into owners via Laine’s “rent-to-mortgage parity” equation. But when the deal closed, Condo.Fund learned about Section 8 vouchers.
“They gave us a rent roll. It was, say, $1,500 a month rent for everybody. We didn’t know that half of those people were subsidized and getting Section 8 until we actually closed,” Laine says. “If we had known, we would probably not have bought Campus, because the subsidy automatically precludes people from actually being able to buy.” The Housing Choice Voucher program, better known as Section 8, allows tenants to pay about one-third of their monthly income toward rent while the federal government covers the remainder.
That blind spot matters. Voucher holders rarely have the income required to qualify for a mortgage at all, let alone on the compressed timeline Condo.Fund’s conversion model follows. Some eligible voucher holders could, in theory, use the program’s homeownership option to apply their subsidy toward monthly mortgage-related costs—but the option is offered only by select housing authorities and requires extensive income, credit, and counseling thresholds; it hasn’t gotten much uptake. While the Portland housing authority, Home Forward, officially offers the option to its voucher holders, there appears to be no participants. Practically speaking, for most tenants of Condo.Fund properties, vouchers are not a viable path to ownership.
For current renters, the conversion comes with a ticking clock. Existing tenants, who may have not even known their building was up for sale, must decide within 120 days of Condo.Fund taking over whether they want to buy or move. That leaves some tenants facing a choice they weren’t expecting—or a move they never wanted.
Even with Condo.Fund’s subsidy and the added relocation funds to pad the downpayment, timing is tight. For renters who hadn’t previously considered homeownership, the 120-day window may be too tight to line up financing, counseling, and savings. At Campus, residents’ lack of ability to take advantage of the purchase opportunity means many renters were thrust back into the housing scramble—in a city already short more than 23,000 affordable units.
Of the 14 units ready for purchase at Campus Apartments, only four have sold as of publication. No existing residents at Campus or Laurelhurst have taken Condo.Fund up on the homeownership opportunity. Laine says the remaining units have largely sat as unsold inventory rather than being rented, a situation he described as “terrible for the business.” Lloyd is currently staggering listings, putting only four on the market at a time to avoid oversaturation.
These are people’s homes. These are people’s lives. We don’t want to screw it up.”
John Laine, founder, Condo.Fund
Laine stresses that Condo.Fund’s goal is to prevent displacement, not compel it. “These are people’s homes. These are people’s lives. We don’t want to screw it up,” he says. “We want to cause the least amount of damage in an uncomfortable situation.” And yet, he admits, the business model leaves little room for flexibility. For renters who don’t qualify for mortgages, the math ends not in homeownership, but in eviction. Without public affordability tools, private conversion models shift risk to tenants who can least absorb it.
Laine is blunt about the stakes: “The business model is the business model.”
“We don’t really have another choice. There’s no mechanism in place for keeping a resident in the building without a mortgage,” he says. “And it sucks.”
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4 thoughts on “Can Condo Conversions Deliver Long-Term Affordability?”
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This is great with a few more tweaks and this will work. I disagree wholeheartedly with Shelterforce’s comments” regarding permanent affordability” the end goal of this program is to make homeowners out of renters not preserve the affordability of units. These two goals are diametrical opposed. Preserving affordability protects the government funding and subsidies – by creating units that are restricted and thusly affordable. However, the consequence for the homeowner is they are literally “worth-less”. Shelterforce’s comments approach the unit as if it is the most important part of the equation to optimize for. The second approach, which this programs intent is focused on, is to optimize for the family. To actually take a family out of restricted income programs and to fully align the family’s effort with its housing payments, wealth and wellbeing. The best way to do that is for the family to benefit from the value of the home they are making payments on. The best way is for the family increase its wealth by increasing its income but not having the housing expense increase at faster rates. We need more housing – agreed!; but more restrictions don’t benefit the family living in the property – it makes the world more narrow and prevents the family from enjoying the upward mobility of owning a home, and the catalyst that it is for each family that buys a neighboring property without the same restrictions. Lets optimize for the family in the property not for the units affordable preservation. If each unit were sold to a family and that family never again has to rent – isn’t that more effective, for the family, for the neighborhood, for the city! Imagine if we took neighborhoods like Brownsville NYC – 19,000 units owned by PHA and converted them to condos with each tenant owning their current unit (unrestricted by income, earning the full appreciation of a five or ten year period) – what would happen to that community 20 years later? AKA this has happened previously – Favelas in Brazil with renters turn to homeowners; Singapore’s Public housing (HBD) selling units back to the tenants with a 99 year lease. The outcomes of an unrestricted asset approach to housing is much better than what we currently have. We should all realize that creating a program starts with an alignment of natural self interests which is far more effective than regulations and restrictions, assuming you are optimizing for the betterment of the family. Love the program – Laine keep going – Good luck.
Thank you for reporting on this.
Condo.fund is not primarily about helping renters become homeowners. And the reporting on this article thoughtfully exposes the realities underneath the shiny marketing. The very real likelihood is that most of the renters won’t be able to purchase. But more obviously those who do successfully purchased their units, it’s really just a temporary two or three year respite from being pushed out. Not to mention the much longer term structural issues that will require a major rehab and infusion of capital. Capital that the current batch of perspective homeowners likely will not be able to afford.
All that said, what condo.fund is offering is a soft landing, or softer transition for both reach CDC, which can no longer afford to steward the building, and for the current tenants, who likely wouldn’t be able to become homeowners in Portland. But for those current tenants who are able to acquire their units, even if they have to sell in two or three years when the HOA subsidy is over, or when repair and replacement costs are unsupportable, there is a possibility that they might be able to sell their units for more than they paid. And thus there might be significant appreciation not to mention a bit of from paying down the mortgage.
It’s far from an ideal solution, it looks like trying to make lemonade out of lemons. But at the end of the day, it will result in fewer affordable units in the city. And I think that’s the deeper critique that the article is surfacing.